Special situation Quickie: Axel Springer voluntary tender offer EUR 63/share
A few weeks ago, PE big weight KKR had announced to make a voluntary tender offer for German publisher Axel Springer at EUR 63 per share.
It is an interesting case as the offer is targeting only a minority stake. The threshold for the offer is set at only 20%.
The background seems to be that the biggest shareholder, Friede Springer and the CEO Döpfner, who own together ~45% want to make sure that they control the company together with KKR as they have entered into a shareholder agreement.
Looking at the stock price we can see that the offer has been made at a significant premium (~40%) but still below 2018 prices:
There seem to have been other attempts to make sure that Friede and Döpfner control the company but they didn’t succeed.
According to the offer document, which was published on July 5th outlines that the offer period including extension will run until Auguts 21st, and payment if successful is expected not later than 10 banking days after August 21st which is then the beginning of September.
Attractiveness as a special situation:
The offer is a friendly one, however at the current price of 62 EUR, the spread is only 1 EUR or 1,6%. Even with the relatively short time frame I think the spread is small compared to the potential downside of -40%.
The threshold of 20% looks low, however around 15% of the other shares are held by long term shareholders & family who might not sell. So the offer is actually for around 50% of the free float and reaching the 20% is maybe not that easy.
So as a summary, this is not attractive for me at the moment. I would get interested if the price of the shares would dip for whatever reason below 60 EUR.